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Councilman Aponte seeks to clear debt to state rep. through bankruptcy

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Providence City Council President Luis Aponte_478321

PROVIDENCE, R.I. (WPRI) – Embattled Providence City Councilman Luis Aponte filed for Chapter 7 bankruptcy Friday as he seeks to wipe out more than $300,000 in debt, the bulk of which stems from a judgement owed to state Rep. Gregory Costantino.

The Ward 10 Democrat, who is currently facing a felony embezzlement charge for allegedly misspending campaign money, claims he owes creditors $316,000. He reported owing Costantino’s business – Cost Realty, Inc. – $300,000, according to the filing.

Aponte listed $3,700 in assets. He did not immediately respond to a request for comment.

Chapter 7 bankruptcy is designed to clear all unsecured debts, while Chapter 13 helps a person or business repay their debt over five years. Chapter 11 is typically used by businesses to allow for the restructuring of debt.

The money Aponte owes Costantino stems from a years-long legal dispute between the two former friends.

In 2005, Aponte assisted Costantino with a $37,000 tax sale on a property located off of Thurbers Avenue, but the deal fell apart when the city learned there was a separate lien on the property, according to court documents.

The city tax collector’s office issued a refund check to Aponte personally even though the original source of funds was a check issued by Cost Realty. In a previous deposition, Aponte admitted he “mishandled” the money.

Costantino sued Aponte and the city in 2012, the same year he was elected to the General Assembly. A Superior Court judge approved a default judgement against Aponte for $139,000 – including penalties and interest – after the councilman failed to appear in court that year.

Aponte’s unpaid debt to Costantino has grown to $239,233 including interest, according to a transcript of new deposition in the case. Costantino’s attorneys have asked a Superior Court judge to hold Aponte in civil contempt because he invoked his Fifth Amendment right against self-incrimination during the deposition.

In the bankruptcy filing, Aponte also reported owing his ex-wife nearly $14,000 and Verizon $1,200. It’s unclear why he listed $300,000 as the debt owed to Costantino.

The filing does not list $50,347 he owes the R.I. Board of Elections for belatedly filing quarterly campaign finance reports over the years. It was the board’s review of his campaign account that prompted a state police investigation.

Aponte was charged in 2017 for allegedly embezzling from his campaign account, which led to him stepping down as council president. (He remained on the council.) Prosecutors claim he was unable to account for more than $13,000 in campaign funds and have accused him of using the money to cover personal expenses. The case is still pending.

Aponte was re-elected to a sixth and final term on the council last year.

Council President Sabina Matos quickly issued a statement defending Aponte, suggesting the bankruptcy “has no bearing on his role as a city councilperson.” She urged her colleagues “to be respectful as he begins this extremely private process.”

“It has been reported that Councilman Aponte has filed for protection under the Federal Bankruptcy Laws, and I believe that this is a personal matter,” Matos said. “This is a decision that many Americans face every year, and it’s a difficult one. He has a constitutional right to chart this course, and this is not something that should be used as political fodder.”

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Dan McGowan ( dmcgowan@wpri.com ) covers politics, education and the city of Providence for WPRI.com. Follow him on Facebook and Twitter: @danmcgowan 

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